Standing Committee F

[Mr. David Amess in the Chair]

Employment Bill

Amendment proposed [this day]: No. 143, in page 12, line 14, leave out from 'work' to end of line and insert 
'for a period equivalent to an ordinary adoption leave period, commencing on any date not earlier than 20 days prior to placement and not later than the date of the placement or such period, or periods (being less in aggregate than an ordinary adoption leave period) as he and his employer shall agree in writing.'.—[Mr. Hammond.]
 Question again proposed, That the amendment be made.

David Amess: I remind the Committee that with this we are taking amendment No. 144, in page 13, line 3, leave out from 'work' to end of line and insert
'for a period equivalent to an ordinary adoption leave period, commencing on any date not earlier than 20 days prior to placement and not later than the date of the placement or such period, or periods (being less in aggregate than an ordinary adoption leave period) as he and his employer shall agree in writing.'.

Alan Johnson: When we adjourned, I was concluding my remarks on the amendments. I had explained that they were misguided because they would include in the Bill matters best left to regulation, and I was dealing with the issue of employees and employers having the right to modify statutory rights. I said that it would be wrong to imply in legislation that discussions in the workplace could lead to employees somehow signing away their statutory rights. I do not say that that would be a common occurrence, but it could happen, and we need to guard against it. The amendment is therefore misconceived, and I invite the hon. Gentleman to withdraw it.

Philip Hammond: I am grateful to the Minister for clarifying the start date, as the purpose of the amendment was to probe the Minister on that. I suggested 20 days; he assured me that the Government intend 14 days. The pair of us would have been hopeless in the first world war, because neither of us is prepared to die in a ditch over small arguments. I certainly shall not do so for the sake of six days.
 In respect of how leave is to be taken, I accept the Minister's argument that the Bill reflects maternity leave provision and that adoption leave will in practice represent only a tiny percentage of maternity and adoption leave cases. If I were in his seat, I too would argue plausibly that it was inappropriate to reopen discussion.
 If I have understood the Bill correctly, it is possible for an employee, without the agreement of the employer, to duck in and out of work at any time during the adoption leave period. That is rather unsatisfactory. However, even if the Minister, in a moment of madness, were to say to me, ''Yes, I agree—we'll change the provision in respect of adoption leave'', it would not take us much further forward, because the greater issue is maternity leave. I have no idea whether there will be a problem in practice. 
 I am grateful to the Minister for clarifying matters, and I beg to ask leave to withdraw the amendment. 
 Amendment, by leave, withdrawn.

Philip Hammond: I beg to move amendment No. 145, in page 14, line 8, at end insert—
 '(4) Regulations under section 75A or 75B shall provide that a person suffer no detriment by virtue of taking ordinary adoption leave but shall not be protected from any detriment that he would have suffered had he not been taking ordinary adoption leave.'.
 The amendment deals with a matter that we have before discussed slightly differently. The Bill provides for regulations to deal with resumption of employment, seniority, pension rights and so on, but it does not state what principle will be followed in making those regulations. I understand the principle involved to be that no detriment should be suffered, but equally that being absent should not gain an employee any advantage over colleagues who were present at work and not taking adoption, paternity or maternity leave. An additional subsection has been inserted to allow the Minister to say that that is so and to tell the Committee how, in practice and in principle, the Government expect the provisions to work.

Alan Johnson: The amendment seeks, first, to provide safeguards against a non-existent problem. Detriment is dealt with in schedule 6(24), which will amend section 47C(2) of the Employment Right Act 1996, so that employees who exercise their right to ordinary or additional adoption leave do not suffer detriment as a result.
 The other point that the hon. Gentleman raised was the case, for example, of someone due to be disciplined for a misdemeanour and the fact that the person is on maternity, paternity or adoption leave should not prevent the disciplinary process from proceeding. People should not suffer detriment on issues that are entirely unconnected with the leave. That does not have to be written into the Bill, because the issues on which they cannot suffer detriment are in the Bill. Matters such as whether an employee should be treated in the same way as every other employee on issues entirely unrelated to adoption, paternity or maternity do not have to be in the Bill as they are already there by omission. The 1996 Act cites circumstances such as whistleblowing or study leave where no detriment will be suffered by the employee and we have specifically followed the architecture of such legislation. The individual cannot suffer detriment for taking leave. That is written into paragraph 24 of schedule 6. The fact that other issues 
 not related to leave are not mentioned means that employers are entitled to treat those employees in the same way as others. 
 I hope that, with those assurances, the hon. Gentleman will seek to withdraw the amendment.

Philip Hammond: The Minister has helpfully drawn attention to the relevant schedule. I am sorry that I had not spotted it myself. He reassures us that the provision works in the way that I think we understood it was intended to work and he has explained why a reference in the Bill is not required. I am grateful, and I beg to ask leave to withdraw the amendment.
 Amendment, by leave, withdrawn.

Philip Hammond: I beg to move amendment No. 146, in Clause 3, page 14, leave out lines 28 to 31.
 The amendment would exclude paragraph (g) from new section 75D, a section that allows the Minister to modify or apply any enactment with such modifications as he believes appropriate. As before, I have tabled the amendment to probe the Minister about the circumstances he has in mind for modifying other enactments. Giving Ministers a power to amend an Act by regulation is a serious matter. We need to scrutinise it carefully, and it would be useful, and not unusual, for me to ask the Minister what he has in mind under the powers that he is giving himself.

Alan Johnson: Although this is a probing and technical amendment, it would have very serious consequences that I should perhaps explain. Last week, in the context of amendment No. 122, we discussed a precisely analogous provision in respect of paternity leave. Such provisions appear frequently in legislation. For example, identical provisions for maternity leave and parental leave are included in the Employment Rights Act 1996. In effect, such a power enables us to consider the interaction between the new rights that we are introducing and provisions in existing and future law. Any tension or conflict in the detail of the two areas of law enables us to deal with the issue through regulation. It is clear that it could be disproportionate to use primary legislation to deal with matters that might prove relatively trivial.
 Almost by definition, it is not possible to be precise about how we might use the power. If we were aware of every provision that needed amending, we would have included all the necessary amendments in schedule 6, or elsewhere in the Bill. Regulation 22 of the Maternity and Parental Leave Regulations 1999, which provides for the treatment of weeks of leave for the purposes of calculating a week's pay for an employee, is a good example of how we might have used the power. The week's pay that is thus arrived at is used, where necessary, in calculating redundancy or unfair dismissal compensation, and for various other purposes. 
 As it happens, we spotted this issue and we have made specific provisions, but even if we had overlooked it, the fall-back provision would have allowed us to deal with it. There is no better example 
 of how we might use the power than the amendment tabled by the hon. Member for Runnymede and Weybridge (Mr. Hammond) in the light of a Law Society briefing on the interconnectedness of paternity leave and working time regulations. As I said, I was not aware of any tensions arising in respect of maternity leave provisions, but I undertook to study the Law Society's views in more detail. I confess that I have yet to find the time, but if an issue needs to be tackled, subsection (1)(g) will allow us to do so. 
 A final and important example is the Adoption and Children Bill, which is currently passing through the House. That legislation does not allow unmarried couples jointly to adopt, but it might conceivably do so at some point. Were it to do so after the Employment Bill had received Royal Assent, there might be technical implications for the framework of adoption leave. Subsection (1)(g), which the hon. Gentleman seeks to remove, would allow us to take account of that interaction. 
 I hope that I have given some examples of why we need the provision. It has served us well in respect of other legislation, and I hope that the hon. Gentleman will withdraw his amendment.

Philip Hammond: I understand the attraction, from the Government's point of view, of having wide, catch-all powers to change other enactments or to modify their application. It is rather disconcerting, however, to hear the Minister admit openly that they want those powers in order to avoid having to bother to find out the precise ramifications of legislation for which they seek Parliament's approval.

Alan Johnson: Future legislation.

Philip Hammond: The Minister corrects me, and I accept that there is a case to be made in that regard, but the proper procedure would be to include in such future legislation provisions that, where necessary, modify all past legislation. That would at least ensure that Parliament scrutinises such modifications in the form of primary legislation.
 I suspect that the Minister does not want to rule out possible use of the provision to deal with modifications to existing enactments that have yet to be spotted. That gives some cause for concern, as the Bill might have consequences that have yet to be thought through. That, in turn, raises questions about the seriousness with which provisions such as the regulatory impact assessment can be taken. We may be writing a blank cheque. I am not suggesting that the provision is unusual or unheard of; sadly, it is all too common in primary legislation. However, that does not mean that we should not flag up, on a regular basis, the fact that we could be giving Government a wide power to rewrite existing legislation, having failed to draw attention to the impact of the Bill at the right time in Committee. The more that I reflect on the matter—it is difficult to reflect while speaking—the more I think that the argument about future legislation is not good. 
 Future legislation should address incompatibility with existing legislation and, on reflection, the Minister might accept that too. 
 However, I accept that the Minister and his draftsman have not dreamt up this paragraph in a new attempt to subvert the parliamentary process, because it covers an established principle—though that does not mean that we should not have challenged it. I beg to ask leave to withdraw the amendment. 
 Amendment, by leave, withdrawn. 
 Question proposed, That the clause stand part of the Bill.

Mark Prisk: I should like to review where we have got to on clause 3. The principle of adoptive leave is something that all Committee members welcome. In this country, we have not valued as much as we might have done the importance of families in adoption or the role of Government and Parliament in encouraging adoption. The clause is important and we should promote and support it as a principle. Almost all the amendments have been probing and have tried to ensure that the Bill is enacted in a form that is practical in implementation and achieves the consequences that the Minister set out to achieve.
 None the less, concerns remain such as the distinction between domestic and overseas adoptions. That might be reviewed in future. My hon. Friend the Member for Runnymede and Weybridge also rightly pointed to the worryingly extensive use of regulations, particularly in this clause. I am aware that the Bill is intended to be enabling and is designed as a framework, which the Government can flesh out later, but there are two sides to that coin. That gives the Government flexibility, for which there is a need, but, at the same time, two problems arise. 
 First, there may be unintended consequences, which makes it difficult for us to understand how the Bill will work in practice, and, secondly, the first problem makes it difficult to ensure that an assessment of the costs of the clause, through the regulatory impact assessment, is accurate. All the assessment can do is assess whether the framework, and not its contents, is accurate and has been quantified effectively. The unintended consequences and the inability of the regulatory impact assessment to be accurate because of lack of detail mean that one still has concerns about the detail of the clause. That notwithstanding, the debate has been important and Conservative Members support the principle of adoption leave.

Charles Hendry: Does my hon. Friend agree that one of the most important aspects of the clause is that it allows for the placement of children up to the age of 18 and not just young children. It covers children who may well be coming out of care homes where they have been in an unsatisfactory form of care. If we are to deal with the problems that arise later in life, particularly those of homelessness and children who have come out of care, it is desirable that they should have been brought up in a family environment, which is why this is welcome.

Mark Prisk: I am grateful to my hon. Friend for highlighting an important point—there are not many others—on which the Bill may be welcomed. I welcome the principle behind the clause. Concerns remain but I hope that they can be ironed out when the regulations are quantified and completed.

Alan Johnson: I am grateful for the comments made by the hon. Members for Hertford and Stortford (Mr. Prisk) and for Wealden (Mr. Hendry) on adoption applying to children up to 18 years of age.
 We were open about our intentions when we published detailed plans as to how we would frame the regulations in November. That allowed people a feel for how we intend to operate, and we included the kind of provisions that we have mentioned. Where a married couple adopts, one spouse can choose to take adoption leave and the other can choose paternity leave. That has led to legislative confusion because a woman could take paternity leave, but it was nevertheless the sensible and correct thing to do. We also consulted with all the adoption organisations and agencies and they unanimously approved our approach. 
 My hon. Friend the Member for Wolverhampton, South-West (Rob Marris) made the important point about overseas adoptions that although we would not generally think that the placement of a relative fitted the bill for adoption, that could be the case for adoptions from overseas, of which there will be only around 300 a year. I got my figures confused this morning, Mr. Amess, perhaps because I missed your inspirational presence in the Chair. I mistook the figure for overseas adoptions for the figure for adoptions in total, so I must make it clear that 200 to 300 will be the number of the overseas adoptions. That said, my hon. Friend made an important point that we are considering carefully. He cited a constituent who will adopt a child from overseas—having had no previous contact—who is a relative. We shall examine the issue carefully, and work with the Department of Health to ensure that we address it in the regulations. 
 I am a little concerned by the comments of the hon. Member for Hertford and Stortford on the regulatory impact assessment. He might be girding his loins for a later amendment—if we get to it—but the assessment was not a bad stab that is more likely to be accurate than some of the other figures. Assessments are always difficult, but on adoption I remind hon. Members that the cost to the taxpayer will be £10 million. We envisage that the one-off implementation cost will be £1 million and the recurring costs will be between £2 million and £3 million. Not a single employer opposed the measure, and the most common comment was that it is long overdue, a point that has been reflected by Opposition Members. 
 Clause 3 ordered to stand part of the Bill.

Clause 4 - Statutory adoption pay

Philip Hammond: I beg to move amendment No. 149, in page 15, leave out line 8.
 Amendment No. 149 seeks to remove new section 171ZL(2)(c). This is simply to establish—once again it is a problem of language—that we are not talking in this case about a person being eligible for statutory adoption pay when that person has ceased to work for the employer in the ordinary sense of the word rather than the tortuous sense of the word that we have previously discussed. It is important for the Minister to clarify that. In our previous debate on the subject, we convinced ourselves that it was probably acceptable—just—to think of someone who had gone away for six months or a year as having ''ceased to work'', although they had a right to come back, but that it was implausible to think that of someone who had gone away for two weeks. 
 Can the Minister clarify which version of ''ceased to work'' we are talking about and whether the paragraph refers to a previous employer, to a person who has ''ceased to work'' for that employer in the everyday meaning of the term—that is, given up work for good—or to a person who has no intention of giving up working for that employer but has simply gone away to enjoy his or her rights to statutory leave? Can the Minister explain which case we are talking about here? The fact that the question has to be asked underlines the confusion about the language.

Alan Johnson: The purpose of the clause is to ensure that people claiming the allowance are not working at the same time. The amendment would not affect that as it is dealt with in new section 171ZN(3). However, the beauty of including the provision before us is that it establishes up front that someone cannot claim the allowance and carry on working. People get adoption pay for being home to care for the child who has been placed with them. They cannot work and continue to receive payment.
 Subsection (2)(c) uses the expression ''ceased to work'' because it is widely understood in the context of statutory maternity pay. The language is taken from existing statutory maternity pay legislation. I hope that the hon. Gentleman is satisfied enough with that explanation to withdraw the amendment.

Philip Hammond: I think that the Minister is telling us that ''ceased to work'' does not refer to someone who has ceased to work altogether, but to someone who is on adoption leave. That person has not ceased to be employed, but is not actually working. If the Minister, following the review that the hon. Member for Manchester, Central (Mr. Lloyd) has encouraged him to get going, eventually wants to change the definitions from ''employees'' to ''workers'', a person will not cease to be a worker but will have ceased to work. What the Minister is saying, in a nutshell, is that the provision is intended to mirror precisely the statutory maternity provisions. In that case, it is understandable, if still confusing in its language.

Charles Hendry: The wording of subsection (2)(c),
''that he has ceased to work for the employer'',
suggests that he has ceased to work for the employer with whom he was employed before. To my reading, it does not rule out people working for another employer on a part-time basis once they are receiving adoption pay.

Philip Hammond: When the Minister referred to new section 171ZN, I quickly flipped to that page and found that I had made a note against that paragraph that I should clarify with the Minister whether it referred to a contract of service with that employer or to any contract of service. I think that that is my hon. Friend's point, and it is a good one.
 The Minister has clarified the interpretation that we are to put on the rather unsatisfactory phrase ''ceased to work'' in this context, and I beg to ask leave to withdraw the amendment. 
 Amendment, by leave, withdrawn.

Philip Hammond: I beg to move amendment No. 150, in page 15, in line 21, leave out from 'him' to 'has' in line 23 and insert
''and another person and the other person.'.
 I confess that the amendment was drafted before the debate in which the Minister made it clear that only married couples can jointly adopt a child under existing legislation. Given what the Minister has just said about future-proofing legislation, I do not want to pre-empt the Government's legislation on adoption. It is clear that their intention is to allow non-married couples to jointly adopt—[Interruption.] I mean to say jointly to adopt, because, of course, I do not want to be accused of splitting infinitives. Has the Minister considered future-proofing the Bill by making neutral the reference to the civil status of the adopting couple?

Alan Johnson: If we have considered that, we have discounted it. We are discussing not paternity leave but 26 weeks' paid adoption leave for adopters. The drafting may be tortuous, and the hon. Gentleman is right to query it. Couples in a long-term relationship but who are not married cannot adopt at the moment. Only married couples or one person in an unmarried relationship can adopt. A married couple who adopt can choose which of them takes adoption leave and which takes paternity leave. The partner of a single person who adopts can take only paternity leave--there is no choice. The person with the matching certificate takes the adoption leave. Those are the present circumstances. Any couple can enjoy leave. Married couples can decide which of them should take which leave; with an unmarried couple the partner with the matching certificate will take the adoption leave and the partner will have take paternity leave.

Philip Hammond: I am not sure that I follow the Minister's argument. One condition for adoption pay under subsection (2) is that the person concerned must be a person with whom a child is or is expected to be placed for adoption. That is the first qualification. If subsection (4)(b) is to make sense, therefore, it is
 absurd that to presuppose that the person addressed by the provision is not the adopter but the partner of the adopter. That seems to be superfluous.

Alan Johnson: I may be making a rod for my own back, but without going into the detail of the text I shall explain the problems of drafting legislation in such circumstances. I want to ensure that everyone understands that married couples may choose what leave they take, but that there is no such choice for unmarried couples. The text that the hon. Gentleman wants to amend states the situation clearly. When married couples adopt, only one spouse can choose to receive statutory adoption pay and then only if all the eligibility criteria set out in subsection (2) are met. That is what subsection (4)(b) states. In my view, it does so unambiguously and conveys its message clearly. As the amendment concerns only a difference in drafting, and I have explained that the Bill's wording is intended to provide clarity in a rather foggy situation, I believe that we have dealt with the hon. Gentleman's points and I ask him to seek to withdraw the amendment.

Philip Hammond: In so far as one can absorb these things when they are being thrown at one in this way, I am probably persuaded that that makes sense. However, it is a shame that we are passing legislation destined to become obsolete when another Bill being considered just 20 yd down the Corridor, and probably coming out of Committee at about the same time as ours, goes on to the statute book.
 My point was whether the Bill should be future-proofed in respect of adoption and the rules surrounding adoption, but I accept that the Minister does not want to explore that avenue any further, so I shall detain the Committee no longer. I beg to ask leave to withdraw the amendment. 
 Amendment, by leave, withdrawn.

Philip Hammond: I beg to move amendment No. 151, in page 15, line 24, leave out from '(5)' to end of line 26 and insert
 'Where more than one child is placed or expected to be placed for adoption as part of the same arrangement, the entitlement to statutory adoption pay in respect of placements under that arrangement shall be as if there were one placement only under the arrangement.'.
 This is another probing amendment to establish what is meant by the Bill's wording. It mirrors an earlier debate, but we cannot automatically assume that the Government's position on statutory adoption pay will be the same as it was on paternity. 
 The Bill states: 
 ''A person's entitlement to statutory adoption pay shall not be affected by the placement, or expected placement, for adoption of more than one child as part of the same arrangement''— 
in other words, a brother and sister, or a family placement. It is not clear to me whether ''shall not be affected'' means that pay will be treated as if there were only one child or, if there were three children, as if there were three separate placements. The attempt to insert a provision for the avoidance of doubt has created much more doubt. Perhaps the Minister can answer my point quickly by explaining whether, in a 
 multiple adoption, multiple periods of paid leave or multiple leave entitlements would be available. For example, if there were two children, would both adoptive parents be entitled to adoption pay? That is the essence of my point.

Alan Johnson: The hon. Gentleman is right: we have discussed this matter before. The wording that he seeks to amend reflects new section 171ZB(6), which the Committee has already approved. That provision deals with situations in which more than one child is placed as part of the same arrangement. It usually occurs with sibling groups, where two or three brothers or sisters may be placed together as part of a new family.

Philip Hammond: Lest the Minister convey the wrong impression to the Committee, may I point out that he is right about new section 171ZB, but that deals with paternity leave for adoption—the two-week period? As I said, the Government will not necessarily take the same approach in relation to the substantive adoption.

Alan Johnson: That is a fair point, but I reassure the hon. Gentleman that we will do so.
 Amendment No. 151 would remove subsection (5) and insert words—to the effect that one period of statutory adoption pay will apply no matter how many children are placed together—intended to clarify what will happen,. The amendment is not necessary to achieve that aim. Subsection (5) means that one period of statutory adoption pay will be available if an adoptive parent adopts one child or two or more children together. That reflects the established position for statutory maternity pay. Further periods of adoption pay will be available to that adoptive parent if he or she adopts another child or children in future. The amendment would add nothing; indeed, it was tabled simply to make it clear that we are taking the same approach that we took in relation to statutory paternity pay for adopters. I am happy to give the hon. Gentleman that reassurance, and I hope that it helps him to withdraw the amendment.

Philip Hammond: I thank the Minister for clarifying the matter. He has, however, left us in the anomalous and unsatisfactory position that if a married couple adopt a brother and sister, only one of them would be entitled to statutory adoption pay, while an unmarried couple adopting a brother and sister—one adopting the brother and one adopting the sister—would each be entitled to statutory adoption pay.

Alan Johnson: As I understand it, the adoption rules would not allow that to happen. Is the hon. Gentleman suggesting that the unmarried couple would get separate certificates of placement?

Philip Hammond: My example is slightly hypothetical. The children need not be brother and sister. Nevertheless, if two unmarried people living together as a couple each adopted a child, the Bill would entitle each to statutory adoption pay. Yet if their next-door neighbours, a married couple, adopted two children together as part of the same placement, they would not be entitled to two sets of statutory adoption pay.
 Let me put another case to the Minister. The Bill refers specifically to 
''more than one child as part of the same arrangement.'' 
Presumably, therefore, if a married couple adopted two unrelated children as two separate arrangements, perhaps through two separate social services departments, they would each be entitled to a period of statutory adoption pay. 
 I admit that these are artificially constructed examples. However, we discussed the case of multiple children before and we came up against unacceptable consequences in extreme circumstances where the dice appeared to be loaded against some people.

Alan Johnson: I am advised that it is unlikely that adoption agencies would place siblings separately with two adopters or place unrelated children in the same household with separate adopters. However, I understand the hon. Gentleman's point. It occurred to me that two women living together who were both pregnant and due to give birth would be entitled to separate periods of maternity leave.
 We are trying to mirror the provisions that apply in maternity leave and we have to try to cater for all eventualities in regulations. We think that we have done that. I am sorry, Mr. Amess—this is an intervention and I am chattering on as if I were making a speech.

Philip Hammond: I am grateful to the Minister for his example, because it is rather better than any that I had thought of. However, it does not help his case. The logic of his example of two women living together who both give birth and are entitled to statutory maternity pay is that two people living together who adopt two children should both be entitled to adoption pay.
 We are under pressure of time. Having probed the Minister on his intentions, I beg to ask leave to withdraw the amendment. 
 Amendment, by leave, withdrawn.

Philip Hammond: I beg to move amendment No. 155, in page 16, line 33, leave out from 'at' to end of line 36 and insert
'the rate from time to time prescribed under section 166 of the Social Security Contributions and Benefits Act 1992 for statutory maternity pay.'.
 The amendment seeks to make it explicit in new subsection 171ZN(1) that statutory adoption pay shall be payable at the statutory maternity pay rate. That is the Government's intention, and the Bill's general thrust is to create a regime for adoptive parents that mirrors the one that is already in place for natural mothers. If that is the case, and to emphasise that that is the case, it would be sensible to make an explicit link in the primary legislation between the rates of statutory adoption pay and statutory maternity pay. I wonder whether the Minister thinks that it is a good idea to send a clear signal about the intention to put adoptive parents on a par with natural parents.

Alan Johnson: We made it clear in our response to consultation and elsewhere that we intend statutory adoption pay to be paid at the same flat rate as statutory maternity pay, which would be £100 a week or 90 per cent. of average weekly earnings. I am happy to tell the hon. Gentleman that that is still our intention, but it is unnecessary to include it in the Bill because there is a difference in that we are not suggesting that the first six weeks should be paid at 90 per cent. of earnings, which is the case with maternity leave but not with our proposals on adoption leave. Adoption leave is £75 a week, but it will be £100 by the time the Bill becomes law, so there is a difference.

Philip Hammond: Why?

Alan Johnson: That was touched on this morning. It is a health and safety issue because mothers must give birth and they must take that time off. There is no choice in the matter because it is compulsory to take up to four weeks off work to give birth to a child. The figure of 90 per cent. of earnings is relevant in that respect, but it does not relate to adoption leave.

Philip Hammond: I wish the Minister would continue because he is effectively unwinding the case that he has made in the past 10 to 20 minutes for aligning the adoption and maternity regimes. His statements on the importance of giving parents a chance to settle children in and of building relationships have been undermined by what he has just said. The Government say that the provision is not about giving adoptive parents the same entitlements as natural parents, but about giving adoptive parents a limited entitlement, and one that economics will often dictate they cannot take advantage of.
 I am surprised that other members of the Committee do not seek to probe the Minister on that issue, but perhaps I am being harsh because they may do so on clause stand part—[Interruption.] I can hear the hon. Member for Doncaster, North (Mr. Hughes) preparing himself for that. After all the fine words that have been spoken about the role that adoptive parents play, how they can contribute to building a better society, how they can relieve the state of some of its obligations and how important it is to create a regime for them that reflects the one already in place for natural mothers, it is brazen of the Minister to stand up and say, ''It is £100 a week for the adoptive parent.'' 
 I cannot see the logic to the Minister's argument. He has made a health and safety case for requiring natural mothers to take a short period off work, and I would not disagree with that. We are, however, discussing a broader arrangement, and I am not convinced that his comments fit comfortably with the signals that he has been trying to send on adoption and encouraging support for adoptive parents. 
 If no one else wants to speak, I will move on by withdrawing the amendment, but I hope that my hon. Friends will further consider that general point in the clause stand part debate. I also hope that Labour Members will have something to say, and that is not an incitement to revolt. If the Minister has a good case, and his position that adoptive parents should receive only £100 a week is sound and supported by good 
 reasons, I hope that those hon. Members who have direct experience and expert knowledge will leap up and make that case for him. In my mind, I cannot make such a case, but if someone else makes it, I might understand it.

Alan Johnson: Perhaps the reason why Labour Members are looking relaxed is because the clause is no secret and I am not suddenly pulling a rabbit out of hat. Since November, we have made it absolutely clear that, in response to consultation and exhaustive debates, we will introduce a flat rate of statutory maternity pay—£100 from 2003—for adoptive parents during the whole 26 weeks of adoptive leave. Previous Governments—the hon. Gentleman's in particular—gave nothing to adoptive parents, and we have moved to give 26 weeks of paid statutory maternity leave, which we are increasing, a further 26 weeks of unpaid leave and paternity leave for the partner or spouse. It is no surprise that we are not allowing for the first six weeks of leave to be at 90 per cent. of earnings—although it may be a surprise to Opposition Members. It is wrong to say that that undermines a principle.

Philip Hammond: I am inclined to ask whether the Minister will give way in his intervention.

Alan Johnson: Sorry. During my very, very brief intervention, I need to make it clear that the idea is not new and is contained in the helpful research guide published by the Library a few weeks ago.

Philip Hammond: I think that I am right in saying that the exclusion from paternity pay of people earning below the national insurance contribution lower earnings level is also not new, but many Labour Members wanted to speak about it. Although the idea is not new, and we have read many things in guidance, explanatory notes and statements of Government intention, the problem is that the Bill contains little that one can get hold of. The Minister has acknowledged that it is perfectly legitimate for me to pose him questions so that he can read into the record statements on specific intentions that are not apparent in the Bill. We know of Government intentions because they have been written about outside the text of the Bill, but this is a significant issue that hon. Members should want to address. I will be surprised if no one says anything about it. However, I am grateful to the Minister for clarifying the situation—at some length—for the Committee. I beg to ask leave to withdraw the amendment.
 Amendment, by leave, withdrawn.

Philip Hammond: I beg to move amendment No. 164, in page 19, line 5, leave out first 'of'.
 This is an important amendment. During my days working the health brief, I always found that I could help Ministers to find a place in a Bill for an amendment—an uncontroversial amendment—to which they could agree. I thought that I had found one in this Bill, and I have tabled a later amendment adding a comma, which is a necessary comma. Sadly, I have been advised that amendments that add punctuation are no longer selected. That was not the 
 case in the good, old days because I remember substantive debates with the then Minister of State, Department of Health—now the Minister for Police, Courts and Drugs—on the insertion of punctuation. The right hon. Gentleman had to concede that the Health Act 1999 was fairly short on punctuation and deficient in a number of other respects, and we were able to do something about that. 
 The definition in new section 171ZS simply has one ''of'' too many. Instead of stating that ''the Board'' means the Commissioners of Inland Revenue, it states that 
'''the Board' means of the Commissioners of Inland Revenue''. 
I therefore invite the Minister to score a first by accepting an Opposition amendment.

Rob Marris: If this is such an important matter, why did the hon. Member for Runnymede and Weybridge not table a similar amendment in respect of new section 171ZJ(1), which includes the same phrase? Is he simply playing games and wasting the Committee's time?

Philip Hammond: If I were wasting the Committee's time, Mr. Amess, you would be the first to have something to say, and the hon. Gentleman should be careful about in any way suggesting that you are not overseeing our proceedings properly. The answer is that I simply did not notice that the phrase is repeated in the new section to which the hon. Gentleman refers. I am afraid that we do not have available to us the vast army of civil servants—

Ian Pearson: Neither does he.

Philip Hammond: Perhaps the hon. Member for Wolverhampton, South-West has nothing better to do with his time, but I certainly do.
 There appears to have been a straightforward error, in that an extra word has been inserted. If not, perhaps the Minister will explain its significance.

Alan Johnson: A great moment has come. I have discussed our drafting with parliamentary counsel and it is not perfect. I congratulate the hon. Gentleman on spotting an error, and I am perfectly happy to accept the amendment.
 Amendment agreed to.

Philip Hammond: I beg to move amendment No. 166, in page 19, line 37, leave out
'subject to subsection (8) below'.

David Amess: With this we may discuss the following amendments: No. 168, in page 19, line 41, leave out subsection (7).
 No. 167, in page 19, line 43, leave out subsection (8).

Philip Hammond: I can understand how those watching our proceedings might find it curious that such joy can be elicited by the acceptance of an amendment dealing with the simple deletion of a single word. However, had they thought up, written down and tabled some 180 to 190 amendments and had not a single one prove acceptable to the Government, they would perhaps understand a little better. On this
 occasion, my joy has been compounded by the intervention of the hon. Member for Wolverhampton, South-West. Apart from anything else, he has given me an idea for an amendment that I could table on Report. That would enable the Minister to repeat his trick—assuming that the hon. Gentleman does not table one first.
 Amendment No. 166 must be taken together with amendment No. 167, which would delete new section 171ZS(8). Subsection (8) states: 
 ''In such cases as may be prescribed, a person's normal weekly earnings shall be calculated in accordance with regulations.'' 
Subsection (6) states that 
''a person's normal weekly earnings shall, subject to subsection (8) below, be taken to be the average weekly earnings which in the relevant period have been paid to him or paid for his benefit''. 
We therefore return to a debate that we had this morning: ''normal weekly earnings'' means ''average weekly earnings'', except in such cases as may be prescribed. In the cases that may be prescribed, 
''earnings shall be calculated in accordance with regulations.'' 
It is all clear. Normal earnings are average earnings unless the Secretary of State says by regulations says that they are something else, as yet unspecified. 
 That situation seems to me not entirely satisfactory, but no doubt the Minister has some explanation and can give us an example of a problem that he will need to address by making regulations that deal with particular cases in which ''normal weekly earnings'' cannot be ''average weekly earnings''. I take it that we are not talking here simply about the bonus example that we had this morning. [Interruption.] Perhaps we are talking simply about that, in which case we shall find out soon. 
 I shall now discuss amendment No. 168. Subsection (7) provides a definition for the purposes just of subsection (6) of ''earnings'' and ''relevant period''. Why does there need to be a different definition of those terms for subsection (6)? What is the distinction between subsection (6) and the rest of this part of the Act, in terms of the appropriate definition of ''earnings'' and ''relevant period''?

Alan Johnson: Amendments Nos. 166, 167 and 168 would remove provisions allowing us to specify in regulations how average weekly earnings are to be calculated. They would be unworkable, leaving it unclear to employers and employees how to determine whether an adopted parent had met the earnings conditions to qualify for statutory adoption pay and how much statutory adoption pay a parent was entitled to receive. Removing the subsections would open up numerous possibilities for misinterpretation of the way in which a person's normal weekly earnings and average weekly earnings should be calculated. The debate that we had this morning on amendment No. 127 and the amendments grouped with it is relevant here.

Philip Hammond: The amendments do not leave out subsection (6), but merely delete the reference in subsection (6) to its being subject to subsection (8). They seek to leave out subsection (8) and the reference in subsection (6) to subsection (8).

Alan Johnson: Subsection (8) covers the situation in which a person is not paid weekly. Subsection (6) provides for calculation of weekly earnings. We need subsection (8) as well to deal with people who are paid monthly or over another period.
 I have a long explanation of the way in which the calculation works, but as the hon. Gentleman is on a roll I do not want to punish him by going through all that. It is quite a complex calculation, but one on which we consulted widely. As I said previously, we proposed to change it and it was employers who said to leave it as it was. 
 As in so many other cases, the subsections reflect the approach taken for statutory maternity pay. Primary legislation for SMP similarly allows for calculation of a person's normal and average weekly earnings to be set out in regulations. I believe that that enables us to provide the detail of how such earnings are to be calculated that employers and employees need to avoid uncertainty. We shall make use of the regulation-making powers provided for in this part to explain in detail how weekly earnings should be calculated for the purpose of statutory adoption pay.

Mark Prisk: If removing subsection (7) would cause greater confusion, could it not be that subsection (7), by giving the Minister future powers to change the definitions, could itself be the root cause of the confusion?

Alan Johnson: I do not think so. We have stuck rigidly to the tried and tested measures that we have used for statutory maternity pay. We have ensured that statutory adoption pay—and paternity pay—mirrors those procedures. It is a system to which employers are used and on which they have received advice and guidance over a long period. The amendments would be unworkable and would do a disservice to employers and employees. I hope that, with that clarification, the hon. Gentleman will seek to withdraw the amendment.

Philip Hammond: I am grateful to the Minister for his explanation. In light of what he has said, I beg to ask leave to withdraw the amendment.
 Amendment, by leave, withdrawn. 
 Question proposed, That the clause, as amended, stand part of the Bill.

George Osborne: I am happy to speak on the amended clause—indeed, happy to speak on a clause that we have successfully amended. This is the first time in this Committee that we have done so. I congratulate my hon. Friend the Member for Runnymede and Weybridge on spotting the mistake and getting the amendment accepted.
 I cannot resist also congratulating the hon. Member for Wolverhampton, South-West. Earlier in the Committee he supported us when he was not supposed to and then he managed to oppose us when he was not supposed to do that either, but he, like me, is a new boy here, and we are learning as we go along. 
 As the briefing documents provided for the Bill show, there are 2,700 domestic adoptions each year. Although that is a small number in the overall scheme of things, it is incredibly important to the children concerned, to the families concerned—many of whom would otherwise be childless—and to society as a whole that society is seen to care for those children who cannot be cared for by their natural families. 
 I very much welcome the Government's stated intention of increasing the number of adoptions. I read that their target is to increase the number by a third. They say that by 2003 there may be as many as 3,850 adoptions. In all sincerity I wish them every success in achieving that target and hope that they exceed it. I believe that statutory paid adoption leave will help. I freely admit that it is not something that the Conservatives, or previous Labour Governments, did. One could argue that Governments of all persuasions have not done enough to make adoption easier for parents. Therefore, I very much welcome the provision.

Mark Prisk: I share my hon. Friend's support for the principle, but does he in turn share my concern that in the debate on the clause there seemed to be a lack of consistency on the Government side? My hon. Friend the Member for Runnymede and Weybridge argued that the Government had failed to be consistent. They have argued for consistency all the way through in maternity, paternity and adoption, and yet that has not been applied in the clause.

George Osborne: My hon. Friend makes a good point and anticipates my remarks. The crucial period for an adoptive family is the initial weeks when a child is placed with the family. It is arguable that it is even more important that time is given for an adoptive family, because the children are often not newborn, but may be one, two or three years old, or even older. They have to adjust to the new family that they find themselves in and the adoptive parents have to adjust to the new child that has arrived in their life, often much more grown up than would be the case in a natural family.
 I therefore share the concern expressed by my hon. Friends the Members for Runnymede and Weybridge and for Hertford and Stortford that statutory adoption pay will be set at only £100 a week for the majority of those who will claim it. This is a good opportunity to bring this new and welcome scheme of paid adoption leave into line with maternity leave. I cannot believe that there would be enormous costs to the Exchequer if people were allowed, for the first six weeks or so, to—

Philip Hammond: My hon. Friend might do the Committee a service if he were specifically to ask the Minister whether his Department has made an estimate of that cost.

George Osborne: I am happy to do so. I understand that the current estimate of the cost is £10 million to the Exchequer for the year 2003-04. I should be interested to know, if the Minister wishes to intervene, what the additional cost to the Exchequer would be if paid adoption leave were brought into line with paid maternity leave.

Kevin Hughes: I should be grateful if the hon. Gentleman would enlighten the Committee. He is arguing for more money to be paid but the shadow Chancellor is on the record as saying that he would reduce Government spending. How does the hon. Gentleman's argument fit with the policy of the shadow Chancellor and the Tory party to cut public expenditure?

George Osborne: I am grateful for that helpful intervention. Sadly, at this early stage of my parliamentary career I am not yet in the position of drafting shadow Budgets. However, I want to make two points. First, my right hon. and learned Friend the shadow Chancellor has decided, in light of recent experience, to put improvements in public services ahead of tax cuts. Secondly, under a Conservative Government the economy would grow much faster and there would be more tax receipts. There would certainly be enough to meet what would, I believe, be the small cost of bringing paid adoption leave into line with paid maternity leave.

Philip Hammond: Will my hon. Friend also take on board the Minister's point that even on purely economic grounds, a case can be made for support for adoptive parents? They relieve the state of a significant financial burden. The point raised by the hon. Member for Doncaster, North has no obvious substance and it seems likely that creating a better regime of support for adoptive parents might be a saving to the public purse in the medium to long term.

George Osborne: My hon. Friend makes a valid point and it is sad that the Government have not apparently assessed the overall saving to the state that would arise if people were encouraged to adopt and to remove children from the state's charge. I am surprised that in their regulatory impact assessment the Government estimate a 100 per cent. take-up. That may be a device that the Exchequer is forcing on the relevant Department so that it knows the absolute total cost, but if families are offered only £100 a week, many will not be able to afford to lose the pay of one member for 26 weeks. It would be interesting to know what the cost to the Exchequer would be if paid adoption leave were brought into line with paid maternity leave. More people would be encouraged to take that valuable time off work; that would be better for the families involved and certainly better for the children. The measure is being introduced and we should take the opportunity to do it well.

Charles Hendry: I noticed you watching quizzically, Mr. Amess, during our debate on adoption and it is clearly something that has never crossed your mind, so you are evidently planning to populate the whole of Southend with people called Amess.

David Amess: Order!

Charles Hendry: I shall now discuss the substance of the clause. I am sorry that the Minister has chosen to say that he has already replied. Clearly, doubts remain and my concern is that adoptive parents will feel that they are being treated as second-class citizens. Some aspects of adoption require more adjustment than natural parentage. When people go through a period of pregnancy, they plan every day for the birth of the child. They think about it and about the changes that it will mean to their lifestyle. Although they cannot adequately understand what difference it will make until it actually happens, they are clearly aware, day after day and month after month, that the change is going to happen.
 When one is adopting a child, the change is much more unplanned and unexpected. Perhaps ''unplanned'' is the wrong word, but one does not have the ability to make the same adjustments and preparations. To tell people in those circumstances that they are worth £100 per week but that natural parents are worth significantly more is to give a misleading and unfortunate signal. I hope that the Minister will still, at this point, return to the matter and address it. 
 I want to pick up on the point covered by amendment No. 149. One of the conditions for receiving statutory adoption pay is that a person has 
''ceased to work for the employer''. 
The Minister told us that that was to stop a person moonlighting, but clearly that person, having stopped working for one employer, could continue to go out and get work elsewhere, part-time or even full-time. I think that the Minister nodded when I raised that point earlier. He is stopping people moonlighting for their original employer and we endorse that, but people may still moonlight in another capacity, working elsewhere. On that, I do not think that the Minister's position is as yet satisfactory. Perhaps the Minister will re-examine the issue and come back with a revised proposal when the Bill comes before the House again.

Philip Hammond: My hon. Friend the Member for Tatton (Mr. Osborne) mentioned the estimated figure of 100 per cent. take-up. I was going to ask the Minister to clarify what take-up of statutory adoption pay he expects. If it is 100 per cent., I would be pleased to hear him say so in Committee, because it is a ludicrous proposition. If it is somewhat lower than 100 per cent., I should be interested to hear how the Department has reached its conclusions about likely uptake, and what conclusions it and the Department of Health have drawn about the fact that uptake will probably be significantly lower than 100 per cent., given the financial support that will be available.

Alan Johnson: This is a fascinating and unexpected debate on clause stand part. Before I get on to the issues, I express my surprise, as I said in my intervention, that five people in the Room—and perhaps in the House—apparently did not realise that
 proposals that had been perfectly clear from the start relate to paying the flat-rate statutory maternity pay for adoption leave. That has been no secret. It has not been buried and only just revealed.
 The hon. Member for Tatton has passionately argued—or with as much passion as can be generated in a Committee Room at a quarter to 6—that we should change the provisions, but there is no amendment. I commend the hon. Member for Runnymede and Weybridge for amendment No. 164. He has done a very diligent job, but what exasperates me is the idea that I have suddenly produced a rabbit from a hat.

Philip Hammond: Given the architecture of the Bill, one cannot make amendments about the rate of pay—a matter that will be determined by the Minister in regulations. I tabled an amendment, with which he has already dealt, proposing to insert words, the effect of which would be to say that statutory adoption pay would be at the same rate as statutory maternity pay. We have indeed tabled an amendment to achieve precisely what my hon. Friends are arguing for. I do not know why the Minister is suggesting that we have not addressed the issue.

Alan Johnson: That is a good stab, but I get the distinct impression here that had I not said what I did on that amendment a few minutes ago, we would have had a totally supportive clause stand part debate on the issue. I think that there is an element of genuine surprise among Conservative Members, which worries me. All that I can do is to re-emphasise my point.

George Osborne: With great respect, this is the first parliamentary occasion that we have had to examine the Bill's clauses in detail. When were we supposed to make these representations if not here, in the Standing Committee of which we are all members?

Alan Johnson: There are things called probing amendments, and Conservative Members are capable—more than capable, in the case of the hon. Member for Runnymede and Weybridge—of using them to make a point. Incidentally, some of the points that have been made support the argument that we should keep these matters in regulations.
 Conservative Members are trying to steal our clothes. It is disgraceful that they should try to assume the position of a successful party that won two elections. We got the Opposition's support for the independence of the Bank of England and the Portillo process gave us their support for the national minimum wage. [Interruption.] I remember that when the right hon. Member for Kensington and Chelsea (Mr. Portillo) was shadow Chancellor he suddenly blurted out that the Conservative party supported the national minimum wage.

Brian Cotter: Does the Minister find it refreshing that Conservative Members are talking about increasing social benefits? Given that they changed their views on the national minimum wage, does he think that in due course they will revert to opposing social provision?

Alan Johnson: Who knows? Who knows whether the Liberal Democrats, who said that the minimum wage should be on a regional, not a national, basis and then ditched the idea, might return to it at some stage?
 Labour Members are consistent. We believe in gradually pursuing a system in which people have minimum basic rights at work, and adoption leave is one of those rights.

Kevin Hughes: Yes, we are consistent. Does my hon. Friend agree that the Opposition are consistent as well, because when they were in government for 18 years they did absolutely nothing about the issue?

Alan Johnson: I do indeed, although they did one thing—in 1994, they reduced the 100 per cent. provision to 90 per cent.
 Conservative Members argue that we have let down adoptive parents and that they are their friends, conveniently forgetting that they tried to prevent people who adopt from overseas from benefiting from the provisions. The hon. Member for Tatton (Mr. Osborne) suggested that 26 weeks at £100 a week would not encourage people to take the leave. We are talking about the first six weeks. Our view, which we have made clear to everyone concerned, is that there is a difference between adoptive parents and mothers who go through natural childbirth. 
 We have introduced statutory paternity pay at the flat, standard rate of £100 a week. That does not marry up with earnings-related rates for health and safety reasons. Earnings-related provision is steered more towards the better-paid and would be more costly. It is difficult to estimate how much it would cost, because we do not know the average earnings of adopters, whereas we can calculate fairly accurately on the basis of the £100 a week flat rate of pay. 
 However, that is not the point. We are introducing this measure for the first time. There is a difference between the position of mothers, who have to take time off, and adoptive parents, who are moving from a position in which they get nothing at all to getting 26 weeks' paid leave. The six weeks are irrelevant; the other 20 weeks will be paid at exactly the same rate as maternity leave. People will get 26 weeks' unpaid leave and their spouse or partner will be able to take paternity leave.

Charles Hendry: Will the Minister give way?

Philip Hammond: Will the Minister give way?

Alan Johnson: Just a second. We are talking about a huge advance, and I do not want it to be diminished by contributions to this debate.

Philip Hammond: I am grateful to the Minister for giving way. He is making a good defensive case, saying, ''Look, it is 100 quid, and that is better than nothing.'' I agree that it may be better than nothing for some people, but for those who earn above a certain level and do not have the wherewithal to forgo their regular earnings it will be effectively the same as nothing, because they will not be able to claim it. The charge from these Benches to the Government is, ''If you want to talk the talk, walk the walk.'' During the
 past few sittings of the Committee, the Minister has given the impression that the Government are extending to adoptive parents the full of range of benefits that is available to natural parents. Now he is being asked to face up to the fact that their proposals, which are outside the Bill, fall substantially short of that in a way in which will make a material difference to many adoptive parents.
 Will the Minister answer my earlier question about expected take-up?

Alan Johnson: Yes, I will come to that. I am just getting into my peroration, for what it is worth, on this matter.

Charles Hendry: Just before the Minister perorates, will he consider the case of a family who are on the national minimum wage? During the six-week period to which he referred, their earnings would be about £1,100. He is suggesting that if they were adoptive parents they would get £600 over that period. Does he believe that they can sustain that loss of £500?

Alan Johnson: That brings me back to take-up. We expect 100 per cent. take-up because it is currently recommended best practice. All adoption agencies say to a couple who are adopting that at least one of them should take time off work at the time of the placement. The best practice guidance is already usually complied with, which is why it is such a crying shame that it has taken so long for the state to provide any help. The best estimate is that there will be 100 per cent. take-up of these provisions because, based on the advice of adoption agencies, it is already almost 100 per cent.
 The hon. Member for Runnymede and Weybridge says that I am making a defence that £100 is better than nothing. Statutory maternity pay, which we shall mirror here, is £75, and statutory maternity pay was stuck at £62 for year after year. In two years we shall have lifted it from £62 to £100, and we are mirroring that payment for both adoption leave and statutory paternity leave. It is a huge advance, and it is recognised as such. We have got that advance in the regulations. There is a difference about the six weeks, of which we have made no secret, and we shall keep the issue under review. It is a significant start on the road to giving adoptive parents help. 
 I must respond to the point made by the hon. Member for Wealden, which is different but important, concerning people who have more than one job. I need to clarify the situation of someone who is not moonlighting for the same employer, but who has another job elsewhere. The primary legislation on statutory maternity pay contains provisions allowing us to make regulations about women who work for more than one employer. We have used those provisions to cover a situation in which a woman works for more than one employer at the time that she qualifies for statutory pay. 
 That is best explained by taking the example of an employee who works for two employers at the time that they qualify for statutory maternity pay. In this case they may, if they choose, return to work earlier with one of their employers than with their other. That applies whether they receive statutory pay from both 
 employers or from just one. They cannot work for one employer and receive statutory pay from them at the same time, but they can return to work for one employer and receive statutory pay from their other employer. That applies whether they have received statutory pay from the employer for whom they have returned to work and that has now ceased, or whether they did not qualify for statutory pay with that employer in the first place. That is entirely reasonable. An employee who has two jobs may feel able to return earlier to one employer—perhaps where he or she works only a couple of hours a week. It is the point that I made to the hon. Member for North Norfolk (Mr. Lamb). That provision is used in maternity leave in particular to reintroduce people gradually back to the workplace after a long absence. It could just as well be used for adoption leave, which spans the same period. Therefore, I am grateful to the hon. Member for Wealden for his prompt to put that clearly on the record.

Philip Hammond: If I have understood the Minister correctly, he is identifying a positive situation in which it could be right for a person to treat his two separate contracts as two separate contracts and deal with them differently. Does he consider that the Secretary of State's power, for the purpose of statutory adoption pay, to regard two separate contracts as one could be significantly disadvantageous for those whom it affects?

Alan Johnson: I would not have thought so. This is a statutory earnings limit debate. Where a person has two separate contracts of employment for the same employer, which happens, they can be aggregated for lower earnings limit purposes. Where a person has two contracts of employment, one with an employer and another with a subsidiary of the company, they can be aggregated. That is what the provisions relate to, so I see no inconsistency there.
 I am reminded of a further point, which is one made by my hon. Friend the Member for Wolverhampton, South-West, about whose intervention the hon. Member for Tatton made a rather ungracious comment. My hon. Friend's intervention was spot on, because the hon. Member for Runnymede and Weybridge noticed a problem in a different part of the Bill. Sometimes that is uncomfortable for Ministers, but it is an important part of the role. However, while the hon. Gentleman is right, the advice that I have received from parliamentary counsel, which we will need to consider, is that this can be treated as a typographical amendment. I thought that I would make it clear that he was right and congratulate him on his vigilance.
 I hope that, with those comments, the Committee will agree to allow the clause to stand part of the Bill. 
 Question put and agreed to. 
 Clause 4, as amended, ordered to stand part of the Bill.

Clause 5 - General functions of the Board

Question proposed, That the clause stand part of the Bill.

Philip Hammond: I want to place one brief point on the record. I referred this morning to the Inland Revenue Regulation Act; I have since found out that it is the Inland Revenue Regulation Act 1890. It is a torture of legislation to be using an Act that was clearly designed for another purpose and it tortures the language and everything else that we do now to bring it within the scope of that Act. I have not looked at copies of Hansard from 1890, but if I wanted to have a guess I would say that the Members of Parliament scrutinising the Inland Revenue Regulation Act 1890—I bet that was a fun one, if they had Standing Committees in those days—would not have had in mind that it should be used to authorise the Commissioners of Inland Revenue to make payments rather than receive payments. It is a rather curious use of language to say that the payment of money to employers in respect of statutory adoption pay should be treated as relating to Inland Revenue and that expressions in relation to Inland Revenue should be treated accordingly.
 That is just a general point. It seems to me that, 112 years later and in a world where the Government are making increasing use of employers to act as a network of benefit payment offices, there is probably a need to regularise that situation. My earlier pleas for recognition of the administrative work that employers' payroll offices carry out in acting as a network of welfare state benefit outposts could equally be dealt with in such legislation. I doubt whether the Minister will want to say anything about that, but he might have some information following this morning's exchanges. Perhaps he has had a chance to talk to the Minister with responsibility for small business, the hon. Member for Edinburgh, South (Nigel Griffiths). Perhaps he has some information on the progress of the review, set up by the Chancellor of the Exchequer, into the burdens that payroll operations, especially the payment of benefits through the payroll, impose on business large and small, but particularly on small businesses. The matter is one that concerns his hon. Friend and the Chancellor.

Alan Johnson: I note what the hon. Gentleman says about the 1890 Inland Revenue legislation, although it has not appeared anywhere on my radar screens. On the payroll arrangements, my understanding is that the Carter review does not conclude its consultation period until the end of January. We would expect matters to move on from then.

Philip Hammond: Without wishing to be unfair, if the Minister considers the way that his Department behaved in relation to part 3 of the Bill, he would have to agree that the fact that a review or consultation has yet to finish does not always prevent Departments of State from drawing conclusions from it.

Alan Johnson: Touche, as they say across the channel. And I thought that I was being helpful. That is the Carter review out of the way, but I should point out that we have stayed absolutely true to the Inland Revenue Regulation Act 1890—1890 was probably the last time that the Opposition reviewed their social policy—in so far as it governs the way in which the Inland Revenue does its business. The clause simply ensures that the same provisions, standards and practices that apply to the working families tax credit and other aspects of the Inland Revenue will be applied consistently to the provision of standards and practices for maternity leave, adoption leave and paternity leave. The hon. Gentleman says that it is time to look again at the matter, particularly the way in which the language is lifted. That is a different point for another time, but it would be wrong to use this Bill to start changing the process. To do so would cause great consternation among employers.
 Question put and agreed to. 
 Clause 5 ordered to stand part of the Bill. 
 Clause 6 ordered to stand part of the Bill.

Clause 7 - funding of employers' liabilities

Philip Hammond: I beg to move amendment No. 172, in page 22, line 4, at end add—
'(c) include provision for a person who has made a payment of statutory paternity pay or statutory adoption pay qualifying for small employers' relief to be entitled to recover such further sum in respect of his administrative expenses as the regulations shall provide'.
 I had nothing to say on clause 6 because, I am disappointed to say, my substantive amendment to it—my comma—was not called. 
 The matter to which amendment No. 172 refers is one that we have dealt with already. Perhaps the timetabling was such that it could not be grouped with earlier amendments for a single debate. Given that we are under such pressure of time, it would probably be inappropriate to delay our proceedings by asking members of the Committee to consider an issue that we have already discussed. Therefore, I shall not press the amendment.

David Amess: We now come to amendment No. 173.

Philip Hammond: I beg to move amendment No. 173, in page 22, line 11, leave out 'may' and insert 'shall'.

David Amess: With this it will be convenient to discuss the following amendments: No. 174, in page 22, line 29, leave out subsection (6).
 No. 175, in clause 8, page 22, line 38, leave out
 'Regulations under subsection (1) may' 
and insert 
'if regulations are made under subsection (1), they shall.'. 
No. 176, in page 23, line 6, leave out subsection (3). 
 No. 181, in clause 10, page 24, line 19, leave out subsection (3).

Philip Hammond: It is amendment No. 175 that I intend to address substantively. Amendments Nos. 173 and 176 cover territory that we have debated and it would not be appropriate to go round that loop again. The same applies to amendment No. 181.
 Amendment No. 175 is slightly different and would amend clause 8(2). Clause 8(1) provides that the 
 ''Secretary of State may make regulations with respect to the payment . . . of statutory paternity pay and statutory adoption pay.'' 
Clause 8(2) states: 
 ''Regulations under subsection (1) may, in particular, include provision''. 
I have always thought that those subsections were strange. Having said that the Secretary of State has power to make regulations, what is the point in then saying that those regulations ''may, in particular'' include provision but in no way limit the discretion of the Secretary of State to do what paragraphs (a) to (d) provide? The purpose is not clear, unless it is to signal an intention to do something. It seems that if the Secretary of State makes regulations under subsection (1) 
''with respect to the payment by employers of statutory paternity pay'', 
employers will have an absolute requirement to know what records they are required to keep. We shall discuss situations in which people fail to produce records that they are supposed to keep. 
 If regulations are made under clause 8(1), I suggest that the question is not that the Secretary of State or the regulations may include provision for records to be kept, but that they must include provision for records to be kept. The amendment suggests that clause 8(2) should state that if regulations are made under subsection (1) they shall ''in particular, include provision'' and so on. It would then be clear that if subsection (1) is used, subsection (2) will provide detailed requirements in regulations about the records that are to be kept. Everyone would then know exactly where they stand.

Alan Johnson: We have returned to our old friends ''may'' and ''shall''. I recall that during our proceedings last Tuesday evening, the hon. Gentleman's view was that the use of those two words came about because of their normal use in different sorts of legislation. He may be right, but I am happy to return to the fray.
 The hon. Gentleman did not refer much to the other amendments, but it is important that I touch upon them. I shall deal first with amendment No. 173. Clause 7 covers the way in which statutory paternity pay and statutory adoption pay will be recovered by employers. We have made it clear from the start that employers will be able to recover a proportion of the statutory payments that they make, following the 
 precedent of statutory maternity pay. The provision for recovery is in the Bill and the detail will be in regulations. 
 We see no circumstances in which we would withdraw the employer's right to recover so the first part of the clause provides that the Secretary of State ''shall'' make those regulations--that point was made by the hon. Member for Hertford and Stortford this morning--and those regulations ''shall'' deal with the amount that an employer may recover. As I said, the amount in percentage terms is fixed in the Bill, as it is for statutory maternity pay. 
 Amendment No. 173 asks for a commitment to regulations under clause 7(4) and there is no difference here. The subsection sets out matters that will be covered in regulations, but it does not set out everything that may be in regulations. It tells us that regulations ''may, in particular'' provide for funding in advance to come from moneys that the employer is due to pay to the Inland Revenue and it will recover any amount overpaid. If the hon. Member for Runnymede and Weybridge is looking for a commitment to do that, I can give him one. The regulations made under subsection (4) will do a couple of important things—

Philip Hammond: I was not going to have this debate because we have heard it before. However, as the Minister has chosen to have it, will he tell us—to avoid doubt—whether he would be in less of a position to regulate on matters if subsection (4) did not exist? My contention is that he would not, so the subsection is superfluous. It serves no purpose to have a subsection that uses the phrase ''may, in particular''. It is already clear from subsection (1) that regulations may do all of those things and more.

Alan Johnson: I believe that the subsection is necessary. The hon. Gentleman seems to want to change the words ''may, in particular'' to ''shall, in particular''. However, it is the words ''in particular'' that are particularly important because we may want to do other things as well. It is important to give employers the comfort that they will have the ability to recover the money that they pay out to the Inland Revenue. Most important, the subsection provides for a right for employers to be able to ask for a payment in advance from the Inland Revenue. That is new and a way of helping employers in a Bill that takes the opportunity to tidy up anomalies.

Mark Prisk: The Minister has taken the issue further from the point that I wanted to raise. He cites the need for flexibility in the clause, which I understand to a degree, but does he agree that, as the Government have had to change their position with other payroll costs, circumstances could mean that changed regulations might allow the Government to reflect administrative costs for small employers?

Alan Johnson: Last Thursday, the hon. Gentleman expressed concern about whether we would be able to change the figure of 92 per cent. It is included in the
 Bill, so could be changed only by primary legislation. It would be difficult for us to provide additional assistance and we would not be keen to do so, for the reasons that I have stated.
 Turning to clause 8 and amendment No. 175, the hon. Member for Runnymede and Weybridge is obviously worried about the use of the word ''may''. Before he made his contribution, I believed that that was his only point, but it now seems wider. The issue of ''may'' versus ''shall'' is relevant and the hon. Gentleman may suspect that the regulations will become optional, but that is not so. We do not intend that to happen because the clause addresses administrative arrangements and it is right that the power to make regulations should be broadly permissive. Administrative arrangements may need to change as the scheme develops, either because they have become too complex or they do not do their intended job. We do not think that they will have to be changed, but they may have to be so the amendment is unnecessary. 
 Finally, reference is made in the Bill to the Inland Revenue and I will not go through the arguments again. Such concurrence with the Inland Revenue exists in other legislation such as that for social security—I checked that over lunch. For all my earlier arguments, I hope that the hon. Gentleman will withdraw the amendment.

Philip Hammond: I was not going to pursue the ''shall''/''may'' debate, which is why I did not speak to amendment No. 173. However, as the Minister has chosen to go down that road, I will follow part of the way. As long as the subsection says ''may'', it serves no purpose in enabling or empowering the Secretary of State. It is a piece of spin. It makes a statement about the Government's intentions. The Government want everybody to know that they may make provision for funding in advance as well as in arrears, to take the example of subsection (4). Subsection (1) says:
 ''The Secretary of State shall by regulations make provision for the payment by employers of statutory paternity pay and statutory adoption pay to be funded by the Board to such extent as the regulations may specify.''
 That encompasses all the things that subsection (4) more particularly sets out. If there is a purpose in setting out three of the infinite number of matters that the regulations under subsection (1) might dictate, it must be to differentiate them from any other group of regulations that the Secretary of State might make. 
 One possible such distinction would be that the Secretary of State undertakes definitely to do certain things. A clause that said that regulations under subsection (1) ''shall'' do X, Y and Z would have some meaning; it would be relevant. It would say that the Secretary of State would exercise his broad, permissive power in the following specific ways. However, by using ''may'', the subsection adds nothing to the powers that it confers or the constraints that it imposes on the Secretary of State. It simply allows the Government to make a general statement about their thinking.

Alan Johnson: The hon. Gentleman makes a good and powerful point. His asked earlier whether we would arrive at the same position if we removed subsection (4). The answer is probably yes, but we would not have mirrored exactly the statutory maternity pay provisions. Despite his powerful case, does he accept that, had we moved away in any form from statutory maternity pay provisions, we would have run the risk of confusing the issue and of suggesting that the provision contained something different? That offers at least some defence for carrying over the same language, though perhaps we have not looked as closely as we might have done at tidying it up.

Philip Hammond: The Minister has made the best argument for leaving the subsection as it is—that it is consistent with what is already there. I have had that argument with many other Ministers in debating Bills. There is a point in saying, that a broad, permissive power will be exercised in certain ways, but there is no point in simply reiterating specific cases that the Secretary of State may use his powers to address, because he is being granted substantial and all-embracing powers.
 I do not know why that provision was included in the original maternity pay provisions, but it seems to me to be merely a statement of intent of the kind that, for much of the Bill, has been made in the explanatory notes. A provision could say that regulations under some other subsection ''may'' make provision for the statutory rate of pay to be £X or ''may'' make provision for the number of qualifying weeks of employment to be 26, but it could say something else. That gets us nowhere, except to give us an indication of the Government's broad thinking. 
 I think that that makes the point in relation to the general ''shall'' or ''may'' debate. As soon as the word becomes ''shall'', it has a structural purpose. I think that the Minister has answered the point that I was addressing in amendment No. 175. Because penalties are attached to failure to produce records later on, and I have a later amendment limiting that to records that are required to be kept, I wanted to be sure that the Government intend to make regulations to define the records that are to be kept, so that there is not open-ended jeopardy with regard to record-keeping and production. If I have understood the Minister correctly, he is confirming that the Government intend to define the records that will need to be kept under the provisions of this part of the Act. 
 I have got into the habit of speaking to clause stand part debates, and had forgotten that this was an amendment. I beg to ask leave to withdraw the amendment. 
 Amendment, by leave, withdrawn. 
 Clause 7 ordered to stand part of the Bill. 
 Clauses 8 and 9 ordered to stand part of the Bill.

Clause 10 - Powers to require information

Philip Hammond: I beg to move amendment No. 177, in page 24, line 10, leave out ''has been'' and insert
''was at the time of the claimed entitlement''.

David Amess: With this it will be convenient to take the following amendments: No. 178, in page 24, line 12, leave out ''has been'' and insert
''was at the time of the claimed entitlement''.
 No. 179, in page 24, line 14, leave out paragraph (d). 
 No. 180, in page 24, line 17, leave out paragraph (e).

Philip Hammond: Amendment No. 177 takes us to clause 10(2). Amendment No. 178 reflects a similar change to the language in the following paragraph. Paragraphs (b) and (c) are affected. As drafted, the Bill refers to a power by regulations to enable an officer of the Inland Revenue to require persons of a specified description to produce information to that officer. Clause 10(2) describes classes of person
''which may be specified by regulations under subsection (1)''.
 Clause 10(2)(b) includes in the definition of classes of person who may be specified by regulations to be required to produce information 
''any person who is, or has been, the spouse or partner of such a person as is mentioned in paragraph (a)''. 
I do not want to suggest that we are on an inexorable slide towards a police state, but clearly that could be a wide-ranging and all-encompassing provision. I suspect that it is quite unreasonable to include anyone who has ever been the spouse of a person mentioned in paragraph (a)—that is, a person claiming to be entitled to statutory paternity pay—among those subject to a requirement to produce documents and information. 
 The amendment seeks to limit the liability of a former spouse or partner to a person who was a spouse or partner at the time of the claimed entitlement referred to in paragraph (a). It seems to me to be reasonable to demand information from such a person, but unreasonable to include any former spouse or partner in the definition.

George Osborne: Does my hon. Friend agree that the clause would allow the introduction of a system, which I suggested earlier in the Committee, to have the mother of a child countersign an assessment made to claim paternity pay? The Minister did not think that that was a good idea, but my hon. Friend did.

Philip Hammond: I heard my hon. Friend's suggestion and I hope that the Minister took it on board. I am not sure that the paragraph would grant to the Secretary of State the power to require countersignature that he is seeking. I take it to be more about the investigation of suspected fraud and abuse. We are anxious to support the war against crime in relation not only to social security fraud, but to more general anti-terrorism measures. However, as the Opposition we are required constantly to be vigilant in defence of the legitimate freedoms of individuals. This measure, taken literally, is an unwarranted extension of the power of the Secretary of State.

Mark Prisk: Does my hon. Friend agree that the measure could prove to be wholly impractical if there is not a sensible time limit as suggested by amendments Nos. 177 and 178?

Philip Hammond: There could be great difficulties. It is necessary to define the information that is required to be kept in the form of records that can be sought. We do not want people to be vulnerable to penalties for not having information that they could not reasonably be expected to know that they were required to retain. That applies to employers in particular. That deals with amendments Nos. 177 and 178.
 Amendment No. 179 is a probing amendment. As the Minister will be aware from other matters that are being dealt with by his Department, the employment agency sector feels put upon by much of the legislation that is coming from the European Union, which creates additional burdens for that booming area of business. I can understand why it is necessary to have the power to require information from people carrying on an agency business—that is, supplying temporary or long-term workers and being remunerated for doing so. However, the definition in the Bill is 
''an agency or other business for the introduction or supply to persons . . . of persons available to do work or to perform services''. 
That would include agencies whose sole business was the making of introductions, whereby an employer enters into a contract directly with the employee and pays a fee to the agency for making the introduction. It would not be appropriate for that type of business to be vulnerable to being classed as a person specified in regulations as someone who is required to produce documents and records for the Inland Revenue. I cannot envisage what documents such a business or person could have that could possibly be relevant. 
 I am also slightly nervous about paragraph (e), and amendment No. 180 probes the Government by seeking to remove it. When one is trying to draft lots of probing amendments late at night, that is by far the easiest way of doing it. One can then think the next day about exactly what one wants to ask. A person who works for any of these agency businesses would be required to produce documents to an Inland Revenue officer. There may be a technical legal reason why the law has to bite on the employees of such businesses. However, we would not want a ''servant or agent''—as the Bill quaintly describes an ordinary employee—to be vulnerable to penalties because they were unable to produce a document that their employer was supposed to keep for the Inland Revenue. I wonder whether it is over the top to have a specific ability to make regulations requiring employees of agencies to produce documents directly to an officer of the Inland Revenue. I should have thought that it would be more appropriate to define the person who is required to produce the document as the business itself, which would act through the agency of its servant or agent in producing the document and handing it over.

Alan Johnson: The hon. Gentleman is right: clause 10 is important in providing the necessary backstop for dealing with the minority of employers and employees who do not want to co-operate. It will be essential to counter fraud and negligence.
 I understand where the hon. Gentleman is coming from. He wants to make sure that Inland Revenue officers have no power to dig around in issues that should not concern them. I draw his attention to the overriding principle set out in clause 10(1), which contains the word ''reasonably''. The information must be reasonably required in order to check out whether there is an entitlement to statutory paternity or adoption pay. That provides an absolute safeguard in that an Inland Revenue officer must have good grounds for supposing that the person from whom he wants to obtain information has information relevant to the matter in hand—indeed, that it is critical to the matter in hand. 
 If the Bill were drafted in the way set out in the amendment, an additional and unnecessary step would be imported into the process. The officer would have to prove the former partner's or employer's status at a specific time, which would be unworkable. Indeed, their status might be part of the dispute. An employer could argue that an employee left their employment on a date before the entitlement to statutory paternity pay started, while the employee could argue that they were still employed. To sort that out, the Inland Revenue officer would need to see payroll and personnel information, but the employer could refuse to co-operate by maintaining that they were not the employer at the time of the entitlement. It would be difficult for the Inland Revenue to pursue that if the amendment were carried. I am sure that the hon. Gentleman can appreciate the problems that that might produce. 
 The amendment is not necessary because the effect is already achieved by the clause. Nor is it workable because it would import an additional complexity into the operation of the clause.

Mark Prisk: Will the Minister enlighten me as to whether the Data Protection Act 1998 crosses over here and whether the providing of information and documents is compliant with the 1998 Act?

Alan Johnson: It is entirely compliant with the 1998 Act.

Philip Hammond: The Minister has made a persuasive case against amendment No. 178 in relation to an employer. On amendment No. 177, which deals with former spouses or partners, will he tell us what information he thinks the Inland Revenue might reasonably require from a former spouse or partner?

Alan Johnson: Whether there was a relationship with the child.

Philip Hammond: At the time?

Alan Johnson: Yes; at the time. This may be something that is happening after the event—[Interruption.] It will be something that is happening after the event: I can always rely on my hon. Friends to spot the unintended consequences of my remarks.
 The point about reasonable requests in clause 10(1) would cover asking a former spouse from years ago about something entirely immaterial. If the amendment were carried and we took out 
''has been, the spouse or partner'', 
it would be extremely difficult for the Inland Revenue to pursue someone who was the spouse or partner at the time that an issue occurred, but who was no longer the spouse or partner.

Philip Hammond: No; I am sorry, that is not right. The amendment would replace the phrase ''has been'' with
''was at the time of the claimed entitlement''. 
I think that the Minister is saying that, in practice, it would be reasonable for an officer of the Inland Revenue to seek information from a former spouse only if that person had been were the spouse when the entitlement arose—exactly the requirement in the amendment. 
 I suspect that the Minister is not going to change his mind in an instant, and given that we are pushed for time I do not want to press the matter further. He seems to have made it clear that there are no reasonably foreseeable circumstances in which it would be acceptable for the Inland Revenue to pursue a spouse, except where the person concerned had been the spouse or partner at the time that the entitlement arose and, by implication, the fraudulent or negligent claim was made. If the Minister is saying that, although he prefers to retain the more permissive language, he suspects that, in practice, the language of subsection (1) will apply a constraint similar to that which amendments Nos. 177 and 178 would apply, I am content.

Alan Johnson: If we had time, I am sure that both the hon. Gentleman and I could think of circumstances in which the Inland Revenue might seek to gather information from a previous spouse or partner.
 On agency workers, it might help the Committee if I provide some practical examples. Given the pressure of time, I apologise for doing so, but it is right that we deal with the matter properly. Many agency workers are likely to qualify for statutory adoption pay and statutory paternity pay, just as many are entitled to statutory maternity pay. They might be employed earners under the normal statutory definition for social security purposes, or treated as such by virtue of regulations that apply across the board in many social security and tax circumstances, including national insurance. In those circumstances, they will qualify for statutory pay, so it makes sense for the Inland Revenue to be able to require information from employment agencies if necessary.

Philip Hammond: I do not think that the Minister has addressed my point. I fully understand why the provision needs to bite on employment agencies that supply labour, but I cannot see why it need bite on
 those whose business is the introduction of persons available for work: employment agencies that place full-time employees with their prospective employers and, having made the introduction, take a fee and depart the playing field. In those circumstances, I cannot see that such agencies have anything to offer the Inland Revenue.

Alan Johnson: My instinctive reaction is to say that I see the hon. Gentleman's point, but we might accept such an amendment only to discover subsequently that the Inland Revenue did indeed need to investigate an introduction by an employment agency. For example, it might need to establish the date on which an introduction was made because there was an argument about the date on which the 26-week period began. It would be foolish to adopt an amendment that made it more difficult for the Inland Revenue to deal with the—albeit few—people who try to claim fraudulently, be they employers or employees.
 I return to the subject of people acting on behalf of employees, their spouses or partners. On amendment No. 180, I can assure the Committee that the Inland Revenue would never directly contact such an agent without the express permission of the employee, their spouse or partner, the employer or an employment agency. The most common example is an accountant or payroll bureau acting on behalf of an employer. Employers often authorise the Inland Revenue to deal directly with their agents on tax and/or payroll matters. If the amendment were accepted, the Inland Revenue would not be able to contact those agents when it needed to make inquiries about statutory adoption pay and statutory paternity pay, despite having written authority to do so, which it needs in all cases, as I have explained. It would have to go back to the employer to obtain the necessary information, even though the information is probably held by the agent.

Philip Hammond: That confuses me a little. I am not a lawyer, as I freely admit and proclaim from the rooftops, but I would have thought that if the Inland Revenue has a certain right in relation to a person, it would, where that person has an agent acting for him, be able to deal with the agent, but ultimate liability would lie not with the agent but with the person. That is important because in the next clause, if we get there, we will find that penalties fall on people specified in clause 10 for failing to produce documents. That would make an agent liable for failure to produce a document on behalf of his client or principal. That seems to me to be out of kilter with what I would have understood to be the normal arrangement -that an accountant handing over data to the Inland Revenue would be doing so on behalf of his principal.

Alan Johnson: The clause is about pursuing information, and the amendment would prevent the Inland Revenue, even where it had written permission from the employer, which it would have to have before it went to the agent, from pursuing information from someone who deals with the employer's payroll
 arrangements week in and week out. That is the purpose of subsection (2)(e), which the hon. Gentleman seeks to remove in amendment No. 180.
 I have tried to give instances where the provisions will be necessary, within the overarching necessity that the requests for information may reasonably require the information set out in subsection (1). I hope that on that basis the hon. Gentleman will seek to withdraw the amendment.

Philip Hammond: I have already said that I shall seek to withdraw amendment Nos. 177 and will not press amendment No. 178. I do not find the Minister's argument with regard to amendment No. 179 persuasive. The reason for raising the issue was, as I said earlier, that the employment agency sector feels that it has taken rather a bashing lately from his Department, largely as a result of things coming from Europe rather than things dreamed up in Victoria street. However, it is important to place it on the record that this is another burden on a sector that has been under pressure.
 I do not follow the logic of the Minister's argument on amendment No. 180. He gave the example of an accountant who is acting as an agent for an employer and has been given authorisation in writing by the employer to pass documents to the officer of Inland Revenue. In those circumstances, it would seem to me that the agent is transparent. He is merely the hand that passes the documents to the Inland Revenue on behalf of the employer. He cannot have any liability for failing to produce those documents; it is the employer's responsibility. If the agent is acting on the employer's written instructions, the employer should remain liable. 
 The Minister did not acknowledge that subsection (2)(e) gives the Inland Revenue the power to knock on the accountant's door and say, ''To hell with your principle. I reasonably require you to hand over this, that or the other document. You will now do so on pain of a penalty under clause 11.'' That is not the same as enabling the Inland Revenue officer to obtain information from an agent whose principal has willingly consented to the agent acting in that way. That is my difficulty with this matter.

Alan Johnson: Does the hon. Gentleman accept that the agent himself might be the problem here? The agent himself might be behaving fraudulently by pocketing the money received for bogus adoption leave or statutory paternity pay. The result would be that we could not require information from the agent. I gave an example of an accountant, the example most likely to occur, where an employer has given written permission to approach the agent. The hon. Gentleman is quite right to say that it is difficult to think of circumstances in which that would not be enough, unless the agent was involved as well, or was the cause of the problem.

Philip Hammond: Of course the Minister is right. The agent, this poor hapless accountant, might well be the guy at the heart of the scam, but so might the next-door neighbour or the chap running the corner shop down the road. I do not think that accountants or agents have a monopoly on benefit fraud. I think that the Minister is right to say that the agent might be someone whom the Inland Revenue needs to address, but I suspect that the regulations under subsection (1) will be drafted broadly enough to allow Inland Revenue officers to require documents from anyone whom they reasonably believe to be involved in a benefits fraud. I would be surprised and disappointed if that were not the case. Subsection (2) spells out some particular cases.
 In view of the time and of the outrageous guillotine that has been imposed on the Bill, and notwithstanding the fact some matters remain unresolved, I beg to ask leave to withdraw the amendment. 
 Amendment, by leave, withdrawn. 
 Clause 10 ordered to stand part of the Bill.

Clause 11 - Penalties: failure to comply

Philip Hammond: I beg to move amendment No. 182, in page 24, line 23, after ''record'', insert
''which is or was at the time of the request in his possession or which he is required by this Act or any regulation made under it to keep.''.
 The amendment, like the next one, seeks to deal with the way in which the penalties clause, clause 11, will operate in practice. Clause 11(1)(a) says that where a person 
''fails to produce any document or record, provide any information or make any return, in accordance with regulations under section 8 . . . he shall be liable to the penalties mentioned in subsection (2) below''. 
That is a wide-ranging power and does not, in my view, spell out sufficiently clearly that the requirement to produce documents on pain of a financial penalty will be limited to documents specified in regulations as ones that the person being addressed is required to keep. 
 In other words, as is the practice with taxation and payroll matters generally, if someone knows that they must keep their records for six years, seven years or whatever it is, they must be able to produce them and can expect to be penalised if they cannot do so. In the absence of a document being specifically defined as one that must be kept, it seems unreasonably onerous on our good friends small employers—whom I cite one more time before getting to the end of today's proceedings—to include the clause with unlimited scope.

Alan Johnson: Let me say at once that we do not expect the penalties to be imposed very often. However, as with statutory maternity pay and statutory sick pay, we need to have provisions available.
 Amendment No. 182 talks about the penalties that will apply when someone has failed to produce the documentation that clause 8 requires them to keep. The requirement will not be onerous. It is reasonable that Inland Revenue officers should be able to view those records during routine visits and confirm that payments have been made and recovered correctly. Similarly, they will need to examine records and call for information where it is necessary to intervene in a dispute and decide whether statutory paternity or adoption pay should be paid. We need a sanction to back up the requirements to keep and make available such records. It is necessary to defend the right of employees to receive what they are entitled to and it helps to defend the Exchequer from those rare situations in which someone attempts to obtain something to which they are not entitled.

George Osborne: In view of the importance of the issues that the Minister is discussing and the fact that the Committee has not discussed any of the clauses relating to statutory maternity pay and statutory maternity leave, will the Minister provide more time for debate of these important issues and lift the guillotine that is about to fall?

Alan Johnson: The programme motion is a matter for you, Mr. Amess. It was agreed at the beginning of our proceedings. Labour Members are surprised at the amount of time that has been spent on some issues when we could have gone on to other matters.

Philip Hammond: I am fascinated that the Minister has identified some issues in part 1 of the Bill that need to be debated. Will he tell the Committee which matters need further debate in Committee?

Alan Johnson: The hon. Member for Tatton set out the matters that he would have liked debated. I merely made the point that we spent some time discussing some other issues, but I am in danger of touching on sensitivities.

Tony Lloyd: Does my hon. Friend agree that the Committee has debated the issues, particularly amendment No. 182, in a reasonable spirit? The hon. Member for Runnymede and Weybridge has done that reasonably, but at considerable length. Alas, because of his filibuster, we shall be unable to discuss the issues surrounding statutory maternity pay.

Philip Hammond: On a point of order, Mr. Amess, the hon. Gentleman accused me of filibustering. We did not do that even in the good old days before guillotines and we certainly cannot do so now. No Chairman on the Speaker's Panel would permit it.

David Amess: I think that I have heard enough. We must return to the amendments.

Alan Johnson: Of course, Mr. Amess.
 I have explained that the provision is for penalties in respect of specific records and we shall set them out in regulations under clause 8. The amendment would go much further and penalties could be applied for any 
 documentation held by the employer or person or any that he was required to keep under the Social Security Contributions and Benefits Act 1992. Absolute clarity is required in all matters relating to people's obligations and the sanctions for failing to comply with them. People must know what they must do and what will happen if they fail. 
 The amendment could confuse people. I know that that is not what the hon. Gentleman intends, but I hope that he can see the unintended consequences and that he will withdraw it.

Philip Hammond: That is certainly not the purpose of the amendment. Its purpose is to limit the scope of subsection (1)(a) to documents that are required by regulations to be kept and which are properly required by an officer of the Inland Revenue in accordance with regulations under clause 8. There is a point there, but in the hope of being able to reach the next amendment before the guillotine falls, I beg to ask leave to withdraw the amendment.
 Amendment, by leave, withdrawn.

Philip Hammond: I beg to move amendment No. 183, in page 24, line 35, at end insert
'(subject to subsection (3) below)'.
 This is a probing amendment. Subsection (2)(b) provides for a continuing, daily-accruing penalty in the event of non-compliance with the requirement to produce documents. The clause also provides maximum penalties for different classes of offences. The purpose of the amendment is to probe the Minister on whether there should be a cap on the total cumulative penalty under subsection (2)(b). I have suggested that £3,000 would be more than adequate. When someone cannot produce a document, there is no point in continuing to charge a daily penalty.

Alan Johnson: We do not intend to provide a cap. The problem with the amendment is that someone who failed to provide evidence that they were required to produce for as little as 50 days could then be free from any penalty thereafter. It is not inconceivable that an employer, to get away from what he considers to be an onerous responsibility--
 It being Seven o'clock, The Chairman proceeded, pursuant to Sessional Order D [28 June 2001] and the Order of the Committee [6 December2001], to put forthwith the Question already proposed from the Chair. 
 Amendment negatived. 
 The Chairman then proceeded to put forthwith the Questions necessary to dispose of the business to be concluded at that time. 
 Clause 11 ordered to stand part of the Bill. 
 Clause 12 ordered to stand part of the Bill. 
 Schedule 1 agreed to. 
 Clauses 13 to 21 ordered to stand part of the Bill. 
Adjourned accordingly at one minute past Seven o'clock till Thursday 17 January at half-past Nine o'clock.